Timeshare properties

A Timeshare is best described as a ‘shared ownership’ in a property. They are typically offered by companies who own multiple vacation properties and offer allotments of use to different people at different times. So, ownership of the properties themselves often stays on a freehold basis with the company itself, but they in turn offer the Timeshare to multiple people who then occupy those properties.

So in essence, a Timeshare is a form of ‘fractional ownership’, where you purchase the right to occupy a property over a specified period of time. For example, if you purchase a one week timeshare you own a 1/52th of the unit.

Timeshares typically use one of the following systems:

Fixed Week

A fixed week Timeshare gives you the right to exclusive use of a property for a specific week (or weeks) each year. The main advantage of this system is that you can plan an annual vacation at the same time each year, but it can be very difficult to change the fixed week to another period if required.

Floating Week

A floating week timeshare gives you exclusive use of a property for a week (or weeks) during a pre-defined period or even throughout the year. While it is more flexible than the fixed week system, the floating week may not be available during the busiest times of the year and may need to be reserved well in advance to ensure availability.

Timeshares are typically owned either by Deed or lease with the particulars set out in an accompanying Legal Agreement.

Shared deed ownership

A shared deed ownership typically provides each buyer with a percentage share of the physical property, corresponding to the time period purchased. Where you have such a shared Deed ownership you can typically sell this on during your lifetime or gift it to another on your death. The Legal Agreement and Deeds themselves will make this clear and set this out in more detail.

Shared leased ownership interest

Shared leased ownership interest entitles you to use a specific property for a fixed or floating week (or weeks) each year for a certain number of years. With this system, the timeshare developer retains the legal freehold title to the property. Property transfers or re-sales are more restrictive than with a deeded timeshare. As a result, a leased ownership interest may have a lower value than a deeded timeshare and cannot always be passed on in the event of your death and in your Will. Again, what is relevant is the Legal Agreement itself.

Timeshares can form part of a person’s estate and can therefore be dealt with in their estate on death. What is relevant is the type of Timeshare that is in place and what the specific legal Agreement sets out. If you have a Timeshare you will need to ensure you take specific legal advice to enable your legal advisor to check the position for you and advise you accordingly.